According to Techpoint Africa's West African Startup Decade Report, financial technology companies had the most Millionaire West African Startups over the last decade.
In recent years, West Africa's startup space has grown in leaps and bounds and Techpoint Africa's report took a close look at startups that raised at least a million dollars cumulatively within the past decade. For the purpose of the report, they are referred to as Millionaire West African Startups (MWAS).
According to data from the report, financial technology (fintech) made up 35% of MWAS. They also closed the most deals (24) between 2010 and 2020.
This phenomenon exemplifies the global focus on fintech companies. In 2019 alone, fintech companies worldwide raised $36 billion, with Africa accounting for $460 million.
Interestingly, despite fintech companies having the highest number of Millionaire West African Startups, online retail companies raised the most funds.
Previous Techpoint Africa reports show that fintech companies have proven to be the main and most attractive destination for investors, but fresh insights from the Decade Report indicate that in the last ten years this has not always been the case.
Between 2010 and 2015, investment in fintech companies was not common. However, from 2017, fintech companies saw a 287% increase in funding.
The payments sub-sector has received almost 70% of the total fintech funding in the last decade. This is not surprising considering the fact that most West African entrepreneurs have focused more on developing the payments sub-sector.
Despite this large investor attraction, fintech companies have barely scratched the surface of financial inclusion in Nigeria.
Their services have been mostly targeted at those already within the banking system, and regulatory and financial hurdles have largely prevented them from creating innovative solutions to serve the mass market.
Techpoint Africa's West African Startup Decade report details trends in financial services for the past ten years and it identifies gaps and opportunities for future and existing entrepreneurs to tackle the issue of financial inclusion in the region.
Which sub-sectors are likely to present something new and game-changing? Which West African countries are ripe for the taking? Find out more in Techpoint Africa's latest report.